Pyschology of Patenting

I would suggest that most patent valuations using any of the 29 known methodologies are usually very wrong and that patents are usually over-valued by a fair margin.

However there are those rare occasions where patents are actually worth significantly more than the cost of development; this hope keeps everyone in the game just like the poor fishermen down at the local creek living off the memory of the 9 kg flathead that Barry caught in 1972.

If this is the case why isn’t here a market correction I hear you ask? Why doesn’t anyone care? And the answer is because everyone is a victim of the same confidence game and hence there is no competitive disadvantage from wearing over-inflated patenting costs and valuations, with negative long term ROI’s.

Even for the odd patent portfolio that has had a positive ROI, where the inventors and executives had trained and knew everything they could possibly know in order to monetise the patents, their successes relied on a large element of luck.

Therefore trying to make money out of patents is gambling. The longer one plays at it, the more one regresses to the negative mean, no matter how well skilled one is.

The only person that ever made money out of gambling was the lucky first timer that walked into a casino, made a killing, and walked away with their winnings never to return. Also known as a unicorn.

So if one wanted to elucidate the psychology of inventors and individuals in companies that want to invest in patents one would be well placed to start with the psychology of gamblers.

And if one wanted to exploit this knowledge one would be well placed to use the sales and marketing techniques of the gambling industry.

Oh, and by the way, I mean this to apply all players in the patent space, from corporates all the way through to nutty inventors.